| But knowledge - and a high IQ - doesn't necessarily lead to judgment or wisdom. (As you'll quickly learn in a short conversation with most Ivy League professors.) For instance, Musk promised that his Department of Government Efficiency (DOGE) would cut federal spending by "at least $2 trillion." I applaud his efforts to eliminate waste, fraud, and abuse. But for those of us who understand how Washinton works, it sounded naïve. His efforts led to actual, verifiable reductions of a few billion dollars - still better than nothing - but overall federal spending continued to rise. In 2013, he said we would have fully autonomous vehicles in three years. That prediction proved almost a decade early. I enjoyed using Waymo robotaxis during my stay in Austin two weeks ago, but Musk said we would have "one million on roads by 2020." Oops. He also promised that there would be "thousands of Optimus humanoid robots" in factories by the end of last year. It didn't happen. I'm not criticizing Musk for being wrong. It's not easy to be a visionary pundit. But he has regularly made technology predictions that were either grossly overstated or way premature. So, what are we to make of his latest prediction that generalized artificial intelligence and humanoid robots will soon take all the jobs, destroy worker compensation (including healthcare benefits), eliminate income tax revenue for federal and state governments, and cause widespread social disruption? Take it with a grain of salt, I say. Just as Musk didn't understand the immense difficulties in cutting national spending, he underestimates the actions that federal, state, and local governments will take to stop millions of people from losing their jobs. The roadblocks are already going up. For example, Americans don't want to pay higher utility bills to support data centers built by multi-trillion-dollar companies that threaten their livelihoods. In fact - surprise, surprise - a report last week by real-estate brokerage CBRE Group showed that data-center construction slowed late last year due to permitting headaches and delays connecting to the grid. Many states are threatening to impose restrictions on data centers unless they build their own power resources. Expect plenty more friction between hyperscalers and the people's representatives in the months and years ahead. Musk may be smart enough to help build generalized artificial intelligence. But anyone who thinks they can snap their fingers and cut $2 trillion from government spending has a lot to learn about how the real world works. There are lots of reasons to believe that AI dystopia is not around the corner. Yet huge productivity gains are. I'll discuss some of those in my next column. Good investing, Alex P.S. The market doesn't wait. And neither should you. If you'd like to receive timely insights and important updates from Liberty Through Wealth delivered straight to your phone, I encourage you to sign up for our free text alerts today. | 
No comments:
Post a Comment